FX.co ★ USD/CAD Price Analysis for December 29, 2020

• USD/CAD struggles to hold near the 1.28 horizontal support
• Key Fibonacci retracement levels add to the upside barriers

A combination of factors prompted some fresh selling in USD/CAD on Tuesday. The prevalent upbeat market mood continued to weigh on the safe-haven greenback. USD/CAD dropped to 1.28 during early trading on Tuesday. In doing so, the loonie pair battles a horizontal area comprising multiple levels marked since December 7.

Although the key support restricts short-term USD/CAD declines, further weakness towards challenging the 1.2800 threshold could be seen. If the quote remains downbeat past 1.2800, the level of 1.2770 can offer an intermediate halt during the downward move to refresh a monthly low around the 1.2700 round figure mark which provides strong support .

Meanwhile, 1.2860 guards the immediate upside of USD/CAD. Even if the USD/CAD buyers manage to cross 50% and 61.8% Fibonacci retracement from November 13 to December 15 downside, the 1.3000 psychological level will be tested for any further rise.